Aguirre Spikes Mayor's Plan

By ANDREW DONOHUE
Voice Staff Writer
Thursday, April 20, 2006

The lynchpin of Mayor Jerry Sanders' financial recovery plan hit a major snag Wednesday after the city attorney opined that the mayor must seek voter approval before borrowing more than a half a billion dollars for San Diego's troubled pension fund.
[ Government - Voice of San Diego ]

City officials will kick off an intense two-week phase of San Diego's budget season Wednesday when the City Council meets in North Park to hear from residents burdened by three years of bad budget news and political upheaval.
[ SignOnSanDiego.com > News > Metro -- Now analyst will evaluate the numbers ]

Note the circularity in the following:

OECD says not enough govt bonds for pension demand
Thu Apr 20, 2006 5:06 AM ET

LONDON, April 20 (Reuters) - The OECD said on Thursday that pension fund demand for high quality bonds may be exceeding supply by a considerable margin, backing long-held complaints from the funds that governments are not meeting their needs.

In a report on trends in financial markets, the Paris-based group said it had tried to gauge the size of potential pension fund demand in Group of 10 countries for bonds and to match it to current supply.

"Potential pent-up demand could be very substantial," it concluded, adding that potential shortages would vary depending what on the maturity and currency of bond issuance.

"Potential 'scarcity' would be greatest (in absolute values) in the United States and in the maturity segment beyond 10 years," it said.

The OECD noted that G10 pension funds held about $15 trillion in 2004 while the amount of long-term government debt came to less than $4 trillion.

With a gap like that, even a modest allocation to long-term government debt would run into scarcity, but the OECD suggested that a 75 percent allocation was not unrealistic.

Pension funds have been increasingly seeking long-term debt in order to meet liability matching requirements imposed on them by government regulators.

This has been at least part of the reason that long-term yields have remained relatively low despite tighter monetary policy from central banks. The OECD suggested, however, that other investors may have been acquiring bonds in anticipation of significantly increased pension fund buying in the future.
[ Stock Market News and Investment Information | Reuters.com ]

Government pensions invest in public debt. This is simple graft of giving oneself money but with the safety in numbers. And then weak opponents bite their tongue if they get a piece of it via arbitrary investment decisions. Note that the last quote is from the G-10 -- as in the biggest economies on the international scene. The future will just get more "inefficient" and "inequitable" over time.

"Lynch"

UPDATE: See Tram of mystery, where I comment to a comment:

“It is time for our citizens, if not the Portland City Council, to demand an immediate, complete and independent investigation”

We could ask KPMG. They have "experience."

A widely anticipated audit of San Diego's 2003 books cannot be completed until city officials fully investigate whether "likely illegal acts" related to the pension system and City Hall's financial-reporting practices have occurred, according to the city's independent auditor.

Oh wait . . . they just finished their work for Portland in January.

Hum? There's some mighty big Sewer (KiwiWit) Bonds slated for May 16 pricing.

Shall I go over the head of our "elected" city "auditor" to the state board that oversees CPAs, with a board that is selected by the same guy that tapped Neil to join the Higher Ed Board while some other bonds were at issue?